L&T to invest Rs 8,000 cr in real estate projects

Mumbai, May 29 | Updated: May 30 2007, 05:30am hrs
In a bid to tap the growing demand for residential and commercial projects in India, the Mumbai-based Larsen & Toubro Ltd is planning to invest Rs 8,000 crore in real estate and urban infrastructure over a period of three to five years through its subsidiary L&T Infrastructure Development Project Ltd (L&T-IDPL). AM Naik, chairman and managing director, L&T told FE, We will leverage our strengths in engineering and construction to develop urban infrastructure, and will focus initially on the southern markets of Chennai, Hyderabad, Vizag, Bangalore and Kochi. HDFC has a 25% stake in L&T-IDPL, and would also be contributing to the investment.

YM Deosthalee, chief financial officer, L&T added, L&T has already invested over Rs 700 crore in real estate and urban infrastructure projects. The management has recently agreed to invest an additional over Rs 500 crore in the business this year. The urban projects are executed through yet another subsidiary of IDPL, L&T Urban Infrastructure. The various projects together are expected to yield around Rs 2,500 crore annually for L&T.

The projects will be implemented in a phased manner, with each under different special purpose vehicles (SPVs). To start with, we are in the process of developing residential projects in Chennai, Vishakapatnam and Colombo, apart from developing an integrated township in Chandigarh in association with a local builder. We have recently acquired land in Nagpur in order to develop a residential project.

L&T IDPL is also working with Bombay Dyeing on redeveloping a dilapidated building in Mumbai. This will be our first real estate project in Mumbai as far as redevelopment of realty projects is concerned, Deosthalee added.